Now that the draft financing plan has been developed and presented, officials and business leaders have begun raising specific issues — both informed and uninformed — with details of the funding model and wider-ranging impacts on the towns along the 25-mile first phase of the project, proposed to run on a rebuilt Norfolk Southern short line known as the "O" Line.
Last week, local businesspeople had a chance to meet with a Red Line consultant to hear more about the proposal and offer their thoughts at a Lake Norman Chamber of Commerce Focus Friday event. Some of them aired what is a growing concern for small business owners and business property owners along the rail having to bear too heavy a burden to help pay for the project with potentially little return (see story, Page 39).
Some more vocal local political leaders, armed with what they perceive as deep gashes in the proposal, have also begun speaking out more loudly than they had in the past (see Idea Exchange, Page 55).
And next week, one of the nation's most ardent critics of rail transit, Randal O'Toole of the Cato Institute, will travel from his home in Oregon to address a special meeting of the Cornelius Rail Task Force the morning of Wednesday, Feb. 8, and then meet with the Lake Norman Transportation Commission at its regular monthly meeting that evening in Mooresville.
O'Toole's appearance is at the invitation of Cornelius Commissioner Dave Gilroy, himself a strident opponent of the Red Line. The Town of Cornelius is paying for his expenses and fee, which total about $2,000.
O'Toole has studied rail transit in various forms around the country and written multiple papers on the subject, all with a recurring theme: government-owned transit has never worked, consistently fails to meet cost projections and never delivers on development and revenue projections.
Consultants hired by the North Carolina Department of Transportation to develop a financing plan for the Red Line — and to repackage it as a hybrid commuter/freight project at a cost of $452 million, half funded by NCDOT and Charlotte Area Transit System and half by special assessment districts and tax increment financing along the corridor — have touted the plan as revolutionary in North Carolina, but tried and true in other parts of the country and around the world.
In an interview with the Citizen last week, O'Toole said that's all akin to putting lipstick on a pig and expecting it to be something other than swine.
"I think it's all just different packaging on the same old thing," said O'Toole. "Tax increment financing is a big cheat. It's presented to the public as we're not raising taxes and not reducing anybody's (towns') tax revenue, so it's like free money. But it's not free money. Ninety-nine percent of the tax revenues of whatever development would occur from natural growth would otherwise go to schools, fire departments, libraries and other needs."
O'Toole's point is that the 75 percent of extra tax revenues produced as a result of ancillary benefit to the rail and station areas will go to retire the debt and pay for operations and maintenance of the line. His big question, which has been raised by others locally, is whether the 25 percent that will be divided among jurisdictions up and down the corridor will be enough to offset the cost of additional services and infrastructure — such as schools, police and fire protection, etc. O'Toole said that not only is the 25 percent not enough, but towns will also be forced to raise taxes on all property owners to meet the additional strain on the local infrastructure.
Red Line consultant Mark Briggs and company have stated repeatedly that the financing model of the Red Line is based only on "known" projects, those that are waiting for the Red Line and are mostly located in four or five "nodes." Towns can still control how much development occurs along the tracks, and the plan only takes into account already-approved developments. The Red Line would just make those larger nodes come in fully as opposed to partially developed, as the land owners say they eventually will without the rail.
O'Toole sees it all as a "boondoggle" filled with empty promises that can't possibly be delivered, and points to the Blue Line Light Rail from downtown Charlotte to just north of Pineville as an example. Anticipated development there has not come in fully as expected, he said, and although the Red Line is a different kind of rail project and in a suburban rather than urban environment, there is no reason to expect it to be any different.
"Another concern for local businesses is that the people who are planning this have a social agenda in mind," said O'Toole. "They want to reform the American lifestyle. The people who promote rail transit have a European view of how Americans should live."
Which is to say, to not travel by automobile. "The truth is Europeans get around the same way we do," O'Toole said. "Eighty percent of them get around by car as opposed to 85 percent for us. That they don't rely on the automobile is a myth."
On a practical level, O'Toole said that the Red Line would be bad for existing businesses along the corridor.
"It will push out existing businesses because they're renting space and the owner will want to take advantage (of the opportunity to charge higher rents) so they will push them out and build the planners' idea of office space near the rail," O'Toole said. "The idea of having an office near the rail doesn't work out so well when you don't have an office."
The special meeting of the Cornelius Rail Task Force will be held Wednesday at 9 a.m. in the Community Room of Cornelius Town Hall. It will feature an open forum, and elected officials from jurisdictions along the corridor are expected to be in attendance.
